American Airlines (AAL) issued lower-than-expected Q3 revenue guide at midpoint, but its "solid" topline and non-fuel cost dynamics should shine through its balance sheet once oil prices stabilize, UBS Securities said in a note Monday.

The company showcased broad-based strength in Q2, driven by robust revenue and well-managed costs, but the near-term stock outlook is likely to be dominated by jet fuel cost volatility, analysts wrote.

UBS said it believes the recent pullback in the stock has created a lucrative opportunity for investors.

The brokerage now expects the company to post a loss of $0.13 in 2026 and earnings per share of $2.53 for 2027, lower than $2.97 previously.

UBS Securities reiterated its buy rating on the stock and lowered its price target to $18 per share from $21.

Price: 14.68, Change: +0.20, Percent Change: +1.38